April 2, 2021 West Virginia Legislative Letter

Welcome to Legislative Brief 2021, your one-stop shop for legislative news from various sources across West Virginia, and my take on the legislative events on the horizon. Today is the 52nd day of the 60-day legislative session.

Legislative Action by Numbers:

1316 Bills introduced in the House of Delegates

721 Bills introduced in the State Senate

200 Bills have passed the House of Delegates

188 Bills have passed the state senate

95 Bills have passed legislative action and are awaiting review by the governor

(52 House, 43 Senate)

Today is the 52nd day of the 60-day regular legislative session. With only eight days left in session, income tax abolition and the vastly different approaches proposed by the Governor, Senate and House of Representatives appear to be the main outstanding bill.

Governor Justice proposed tax increases of $ 902.6 million to fund the personal income tax cut, including increasing the consumer rate and the usage tax rate from 6% to 7.9%. Creation of a tiered settlement tax for fossil fuels; a new tax on certain luxury goods; and increased taxes on cigarettes, tobacco products, e-cigarettes, beer, wine, liquor and soda. The judiciary would also remove sales tax exemptions from professional services such as legal services, accountants, computer hardware and software, and other categories.

The house went by HB 3300 Monday, incremental income tax of $ 150 million for the first full year and annually until the tax is gone. The House version includes an Income Tax Reduction Fund, which siphons off tax revenue from specific revenue streams and existing revenue streams to accelerate tax cuts while encouraging lower government spending.

The Senate Finance Committee changed HB 3300 to create its own income tax plan that seeks to marry off portions of the House and Governor’s plans. The Senate plan would cut income tax rates by more than 50%, even for small businesses and sole proprietorships, but not for investment income. The plan would cut income tax revenues by $ 1.09 billion.

To pay for the personal income tax cut, the Senate version of HB 3300 would increase consumer sales and consumption tax from 6% to 8.5%. It would also remove sales tax exemptions for services commonly used by businesses and tax other services at lower rates.

Other tax increases in the Senate version include the reintroduction of the 2.5% food tax; Taxation of ready meals at 8.5%; a 4.3% tax on short-term accommodation; an 8.5% tax on contingent liabilities; and the creation of a new lottery scratch game.

Stay tuned as this is undoubtedly going to be a hot topic for the past 8 days.

Legislative Calendar – Important Days to Remember

Sixtieth day – April 10, 2021: adjournment at midnight. ((WV Const. Nature. VI, §22)

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